Jacob is a new partner and is admitted to the Abraham & Isaac Partnership under the bonus method. Jacob contributes cash of P20,000 and equipment with a market value of P30,000 and book value of P15,000 in exchange for a 20% ownership interest in the new partnership. Prior to the admission of Jacob, the capital of the existing partnership was P130,000 and the assets were fairly valued. What will be Jacob’s initial capital balance using bonus method?

A. P30,000

B. 36,000

C. 35,000

D. 26,000

Answer rating: 100% (QA)

Jacobs initial capital balance using bonus method will be P35000 which is option C Reason Under the ... View the full answer